Business: Ministry revokes 830 business licenses of Khat exporters due to misuse, illegal activities

Khat, a mild stimulant plant grows mainly in Ethiopia, Kenya and Yemen. Picture: CGTN Addis Abeba - The Ministry of Trade and regional Integration said it has revoked 830 business licenses of Khat exporters who are allegedly "involved in illegal activities" including failure to renew […]

Business: Ministry revokes 830 business licenses of Khat exporters due to misuse, illegal activities
Khat, a mild stimulant plant grows mainly in Ethiopia, Kenya and Yemen. Picture: CGTN

Addis Abeba – The Ministry of Trade and regional Integration said it has revoked 830 business licenses of Khat exporters who are allegedly “involved in illegal activities” including failure to renew business licenses and misuse of their services.

The Ministry said many efforts were being made to increase the country’s income from khat export and streamline the legal trading system. To that end, educative measures were being implemented by the Ministry by setting up a national level of information and organizing a task force to prevent illegal trade and smuggling, clarifying information, as well as tightening and monitoring Khat export exits at national level.

Ethiopia’s resources were [being fed] “to neighboring countries, causing serious damage to the country’s economy.”

Ministry of Trade and Regional Integration

Khat, a mild stimulant plant grows mainly in Ethiopia, Kenya and Yemen; but Ethiopia is known to be the biggest exporting country. According to a research published in 2020 on Khat marketing and its export performance in the Ethiopian economy, “Khat industry is one of the leading agricultural sectors. The industry constitutes 4% of the country’s export earnings andshares9.4% of total merchandise export.”

“The value of Khat is the most dynamic over time. The value received from exported Khat increased from 15.9 million ETB in 1985s to 618.8 million ETB in 2000 and continued to rise and reached 6.1 billion ETB in 2017. The revenue of Khat export also increased from 138 tons in 1985 to 156 tons in 2000 and reached 488 tons in 2017. This was mainly attributed to increased demand from Somalia. Somaliland is becoming the largest importer of Khat replacing Djibouti, the traditional largest importer of Khat”, the research stated.

Data Source: “Khat marketing and its export performance in the Ethiopian economy.”

The statement from the Ministry describe the spread of illegal activities among the Khat export sector as “scourge” that is forcing Ethiopia to lose “its foreign exchange earnings.” It also blamed that Ethiopia’s resources were [being fed] “to neighboring countries, causing serious damage to the country’s economy.”

Based on an assessment, the Ministry said it has taken the measures to revoke the 830 business licenses of Khat exporters. The measures including against traders who have been exporting the product without renewing their business licenses and those who used their license for other illegal activities.

Of these, 14 business licenses of Khat exporters were revoked because they were exporting the product without renewing their licenses; and the business licenses of 40 exporters were temporarily suspended because they misused their business licenses by giving it to third parties, the

The Ministry further said that in its efforts to solve this problem from its foundation, it has completed the preparation of a timely one-window registration service to issue export licenses. It called for Khat exporters to come and register their export documents including trading contracts and verify their legitimacy with the Ministry before receiving export permission from banks. AS